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IRS Holds Off on New W-4 Form

Jonathan Ernst

By Michael Rainey

September 21, 2018

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The Treasury Department announced Thursday that the debut of the Internal Revenue Service’s new W-4 form will be delayed until the 2020 tax year. A draft released earlier this year – you can see it here – was criticized by tax professionals on numerous fronts. One interesting detail: the draft form would require multiple job holders to inform their employers about their other jobs, raising privacy concerns.

The W-4, also known as the Employee's Withholding Allowance Certificate, is filled in by employees to enable employers to withhold the appropriate amount of taxes. The tax overhaul passed last year, which eliminated personal exemptions and doubled the standard deduction, made that process more complicated, and experts feared the draft version would lead to under-withholding for some employees.

For the 2019 tax year, Treasury said it will release a version of the W-4 that is “similar to the 2018 version currently in use.”

Kelly Phillips Erb, a tax expert at Forbes, summed up the frustration felt by many practitioners over the delay: “To be clear, a law that Congress pushed through at the end of 2017, which was effective beginning in 2018, won’t have clear guidance for taxpayers on withholding until 2020.”